Gray Television receives all government approvals for Hoak Media - KSFY News - Sioux Falls, SD News, Weather, Sports

Gray Television receives all government approvals for Hoak Media, KSFY purchase

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Gray Television, Inc. Thursday announced that it has received all government approvals for all of
its previously announced television station acquisitions, including those involving Hoak Media, LLC.

On November 20, 2013, Gray announced agreements with Hoak and separate agreements by
which Excalibur Broadcasting, LLC would acquire television stations in existing or
future Gray markets from Hoak, Parker Broadcasting, Inc., and Prime Cities Broadcasting,
Inc.. At that time, Gray also announced that it and Excalibur would divest Hoak's
and Parker's television stations in the Panama City and Grand Junction markets and subsequently announced on December 19, 2013, that Nexstar Broadcasting, Inc., and Mission Broadcasting, Inc. would acquire the television stations in those two markets.

On March 3, 2014, the Antitrust Division cleared all of the transactions involving the Hoak,
Parker, and Prime Cities television stations. On March 12, 2014, however, the FCC issued a Public Notice imposing new restrictions on pending transactions involving television stations. In response to that action and FCC advice, on March 24, 2014, Gray and Excalibur submitted amendments to their pending applications that restructured the proposed Excalibur acquisitions. The changes included removing Gray's guarantee of Excalibur's financing to acquire Excalibur's new stations and eliminating a put/call option on Excalibur's new stations. In addition, Excalibur withdrew its application to acquire the Prime Cities television stations. Nexstar and Mission Broadcasting also filed amendments to restructure their transaction involving the Grand Junction DMA.

On April 3, 2014, the FCC's Media Bureau approved Gray's applications to acquire the
following television stations from Hoak:

KSFY ABC Sioux Falls, SD 111
KABY* ABC Sioux Falls, SD 111
KPRY* ABC Sioux Falls, SD 111
KVLY NBC Fargo-Valley City, ND 116
KNOE CBS Monroe- El Dorado, LA 137
KFYR NBC Minot-Bismarck-Dickinson, ND 145
KMOT* NBC Minot-Bismarck-Dickinson, ND 145
KUMV* NBC Minot-Bismarck-Dickinson, ND 145
KQCD* NBC Minot-Bismarck-Dickinson, ND 145
KALB NBC/CBS Alexandria, LA 179
KNOP NBC North Platte, NE 208
KIIT-LP FOX North Platte, NE 208
* satellite station

Gray currently anticipates that it will close on the acquisition of the above-listed Hoak television
stations during the second quarter of 2014. The FCC has not acted on the amended Excalibur's applications to acquire the following television stations from Hoak and Parker:

KHAS NBC Lincoln-Hastings-Kearney, NE 105
KXJB CBS Fargo-Valley City, ND 116
KAQY ABC Monroe-El Dorado, LA 137

Likewise, the FCC also has not acted on the amended Nexstar and Mission Broadcasting
applications. Gray cannot predict when the FCC might grant the Excalibur applications.
In light of the FCC uncertainty, Gray is exploring alternative arrangements that may facilitate
the creation of the efficiencies, public interest benefits, and expanded advertiser opportunities that were proposed in the still-pending Excalibur applications. Gray notes, however, that its projected net revenue from providing services to KHAS, KXJB and KAQY is expected to constitute approximately 3% of Gray's annual pro forma net revenues.


Separately, in March 2014, the FCC approved Gray's acquisition of WQCW(TV),
Portsmouth, Ohio and WOCW-LP, Charleston, West Virginia (collectively, "WQCW-TV") from
Lockwood Broadcast Group. WQCW-TV serves as the CW affiliate for the Charleston/ Huntington, West Virginia television market, where Gray owns and operates WSAZ-TV, the market's NBC affiliate. Gray closed this acquisition on April 1, 2014.

Finally, on April 3, 2014, the FCC granted Gray's application to acquire KEVN and KIVV in
the Rapid City, South Dakota, market, which together serve as that DMA's Fox affiliate, from
Mission TV, LLC ("Mission TV"), which is unrelated to Mission Broadcasting. Gray anticipates
closing this transaction in the second quarter of 2014.

The aggregate purchase prices for the transactions outlined above, including the restructuring
of certain Excalibur arrangements as described above, represent a multiple of approximately 6.8
times a blended average of 2013-2014 pro forma broadcast cash flow of the stations, including
expected synergies. As such, consummation of the pending transactions will be immediately free cash flow accretive to Gray. 

Gray has now received government approvals to all previously announced transactions.
Consequently, Gray currently does not have any applications pending before the FCC or the DOJ.


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